LATECOERE

Business activity and results

For the 2007 financial year, the Latécoère group recorded consolidated revenue of €489.3m, up 13% on the previous year. This upturn was the result of increased deliveries across all of the Group's business areas.

EBIT, which includes exchange rate gains, came out at €39.1m, giving an Ebit margin of 8%, which is close to the 2006 figure.

The progress plan, entitled "Objective 2009" and launched in 2006 in order to strengthen the Group's competitiveness, has started to bear fruit and has helped to sustain the Ebit margin for 2007, despite the weakening of the dollar (average rate 2007: $1.37/€; average rate 2006: $1.25/€).

Net income showed sales of €18m (3.7%), down against 2006 levels, with the increase in financial costs accounted for.

Research and development

In 2007, research and development expenditure primarily went into the Boeing B787 and Airbus A400M programmes. These stood at €79m, down on 2006, and represented 16% of revenue (compared with 19% in 2006).
Furthermore, around €3.5m was allocated to technological research in the field of composite materials.

Balance sheet structure

Growth in inventories and work in progress entry continued in 2007, due to development expenditure and production start-up costs on the Boeing B787, Airbus A380 and A400M programmes, and also due to the increase in standardised production, particularly on the Dassault and Embraer programmes.
For these reasons, Group net debt at the end of 2007 stood at €377m compared with €322m at the end of 2006. Shareholder’s Equity stood at €259m, expressing a gearing ratio of 1.46.

Dividends

At the next Annual Shareholders' Meeting, a suggested dividend payment of €0.50 per share (24% payout) will be put forward. Payment will be made on 30 June 2008.

Outlook

The record orders taken by aircraft manufacturers throughout 2007 mean the Group has a firm backlog of €1,820m (+20% compared to the situation at the end of 2006), which is the equivalent of some 4 years' sales. The Group expects growth revenue of around 10% in 2008 compared to 2007.

Takeover of sites in Méaulte and Saint Nazaire

As soon as Airbus announced that it was to dispose of some of its production sites, Latécoère revealed itself as a potential bidder for the French sites. On 19 December, Airbus chose Latécoère as preferred bidder of the Méaulte and Saint Nazaire-Ville sites.

The practical aspects of this takeover will be finalised over the second quarter.

The integration of these two sites will represent a major step in Latécoère's development since the resulting Group will become a major aerostructure supplier on a worldwide scale. By 2010, its revenue should stand at some €1.5bn, based on substantial growth prospects with the launch, in the short-term, of the Airbus A350XWB and, in the medium-term, of the replacements for the Airbus A320 and the Boeing B737.

In order to secure financing for this operation and the predicted growth, the Group is preparing a capital increase of around €300m, the formalities of which will be disclosed very shortly.

About Latécoère

The company is a top-level international partner of the leading worldwide aircraft manufacturers (Airbus, Boeing, Bombardier, Dassault, Embraer). Latécoère is involved in all sectors of the aeronautical industry (commercial, regional, business and military aircraft), in three areas of activity:

• Aerostructure (68% of revenue): fuselage sections and doors,
• onboard wiring and systems (27% of revenue)
• Engineering and services: (5% of revenue):research, design and realisation of tooling.

The Group employs 3,800 people in 8 different countries.
Its consolidated revenue for 2007 has reached €489 million and the order backlog is worth €1,820 million.

Latécoère is quoted in compartment B of Euronext NYSE Paris. Indices: SBF 250, CAC MID&SMALL 190, SMALL 90 - ISIN Codes: FR0000032278 - Reuters: LAEP.PA - Bloomberg: LAT.FP